Yahoo Finance Is CenterPoint Energy, Inc.'s (NYSE:CNP) CEO Paid At A Competitive Rate?
In 2014 Scott Prochazka was appointed CEO of CenterPoint Energy, Inc. (NYSE:CNP). This report will, first, examine the CEO compensation levels in comparison to CEO compensation at other big companies. Next, we'll consider growth that the business demonstrates. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. The aim of all this is to consider the appropriateness of CEO pay levels.
Check out our latest analysis for CenterPoint Energy
How Does Scott Prochazka's Compensation Compare With Similar Sized Companies?
According to our data, CenterPoint Energy, Inc. has a market capitalization of US$14b, and paid its CEO total annual compensation worth US$8.9m over the year to December 2018. While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at US$1.2m. Importantly, there may be performance hurdles relating to the non-salary component of the total compensation. We looked at a group of companies with market capitalizations over US$8.0b and the median CEO total compensation was US$11m. (We took a wide range because the CEOs of massive companies tend to be paid similar amounts - even though some are quite a bit bigger than others).
So Scott Prochazka receives a similar amount to the median CEO pay, amongst the companies we looked at. Although this fact alone doesn't tell us a great deal, it becomes more relevant when considered against the business performance.
You can see, below, how CEO compensation at CenterPoint Energy has changed over time.
Is CenterPoint Energy, Inc. Growing?
CenterPoint Energy, Inc. has increased its earnings per share (EPS) by an average of 41% a year, over the last three years (using a line of best fit). It achieved revenue growth of 15% over the last year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's a real positive to see this sort of growth in a single year. That suggests a healthy and growing business. It could be important to check this free visual depiction of what analysts expect for the future.
Has CenterPoint Energy, Inc. Been A Good Investment?
Boasting a total shareholder return of 44% over three years, CenterPoint Energy, Inc. has done well by shareholders. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.
In Summary...
Scott Prochazka is paid around what is normal the leaders of larger companies.
Few would be critical of the leadership, since returns have been juicy and earnings per share are moving in the right direction. So one could argue the CEO compensation is quite modest, if you consider company performance! So you may want to check if insiders are buying CenterPoint Energy shares with their own money (free access).
Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies, that have HIGH return on equity and low debt.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
